Mariela Molinedo, the disgraced Miss Cholita, had won the competition a day earlier, seeing off competition from thirteen other contestants.
Although mainstream beauty contests are popular in Bolivia, Friday's Miss Cholita Pacena pageant does not feature bikinis, but rather indigenous women who wear the traditional dress of wide skirt, bowler hat and long plaited hair.
The competition seeks to instill pride in indigenous women and contestants have to make a speech in the native Aymara language to prove their Cholita credentials.
The scandal is not the first to hit the pageant. In 2004, the winner caused a stir after her coronation by saying she did not normally wear traditional dress.